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April 2001: Paul Smith writes.... of mixed (up) news for the future.
It was my fellow Buckinghamshire-Boy, Disraeli (1804-81) who once said, "There are lies, damn lies and statistics". Remarkably for a British Prime Minister, he obviously had a point. So this month I'm going to stick to broad sweeping statements to avoid getting bogged down in irksome facts and figures.
The growth in the UK PC market is slowing. It had to happen sometime, and that time is now. The industry is well into its teens and like any spotty adolescent who's discovered sex can involve other people, it's begun to mature. Ignoring the fairly static business market for a moment, there are about 20 million homes in the UK (oops, a figure, sorry) and most of them already have an ivory midi-tower. Thus just about everyone who wants a PC has got one. It makes sense that the focus is switching to replacing older computers rather than selling to first time buyers. Again, logically, the opportunity to do well with part-ex machines is starring you in the face. It works well for the automotive market, doesn't it? Add in that the reasons to buy a PC are getting fewer and further between (blame the Sony PlayStation and set-top-boxes for e-mail and the Internet) and you'll understand why the number being bought, month-on-month, is seeing a plateau.
"Damn", you're thinking. "Just what we need, a slowing of PC sales, leading to bankruptcy and me being forced to eat my family pets just to survive". Well, like the title says, I have good news as well as bad. Firstly, sales of other IT goodies are going through the roof. Laptops are suddenly in demand by people not wearing suits and digital camera sales are also mushrooming like a bad day in Hiroshima. If there's a band(width)wagon to jump on at the moment, it's anything cool and portable enough to show off to your mates down the pub.
Secondly, the UK has the 2nd largest installed user-base of PCs in Europe (we're only beaten by the Germans [Feel free to think of your own racist stereotype joke or comment about 1966 to go here]) and so at the very least you'll have lots of people who's PCs will need upgrading. Incidentally, Germany and France both have bigger populations than the UK, and yet Frances IT market is smaller than ours at the moment. The French, however, are catching us up, which means market growth. Suddenly using that French O level and opening a PC shop in Cannes doesn't seem like such a daft idea after all.
Napoleon Bonaparte (1769-1821) was right, we are a nation of Shopkeepers. The United States of America may be the Land of the Free, but Great Britain will always be the Land of the Buy One, Get One Free.
Paul Smith likes to be known as an Industry Guru, and works for Ingram Micro.